Section 12 - Tax wrongfully collected and paid to Central Government or Union territory Government
Section 12 - Refunds for Wrongly Collected Taxes
This section addresses situations where taxes have been incorrectly collected and paid to the Central or Union territory government. It outlines two scenarios:
1. If a registered person pays central and Union territory taxes on a transaction they thought was an intra-State supply, but it is later determined to be an inter-State supply, they are eligible for a refund. The refund process will follow prescribed conditions and procedures.
2. Conversely, if a registered person pays integrated tax on a transaction they considered an inter-State supply, but it is later deemed an intra-State supply, they won't have to pay interest on the central and Union territory taxes due.
Essentially, this section ensures that taxpayers are not penalized for honest mistakes in tax classification between intra-State and inter-State transactions, providing financial relief and clarity on tax obligations.
Note: It is an AI generated summary for reference purpose only.
12. Tax wrongfully collected and paid to Central Government or Union territory Government
(1) A registered person who has paid the central tax and the Union territory tax on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall be refunded the amount of taxes so paid in such manner and subject to such conditions as may be prescribed.
(2) A registered person who has paid integrated tax on a transaction considered by him to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall not be required to pay any interest on the amount of the central tax and the Union territory tax payable.
